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1960 (11) TMI 100

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..... ubber and Cardamom Estates Ltd., Ayalur, which was then within the TravancoreCochin State, and the turnover determined by the assessing authority for the purposes of the tax is Rs. 69,122-7-4. In this petition the tax disputed is on the entire turnover. In T.R.C. 9/58 the respondent is Messrs Sivalokam Estate, Kuzhithurai, now at Nagercoil, which also was then part of the Travancore-Cochin State and the turnover amounts to Rs. 3,26,921, on which the disputed tax amounts to Rs. 5,108-2-3. In T.R.C. 11/58 the respondent is Messrs the New Ambadi Estates Ltd., Trivandrum, whose estate was outside the Madras State and the turnover on which the tax had been levied, comes to Rs. 2,80,682-7-4, the tax amount being Rs. 4,385-10-8. In T.R.C. 12/58 the respondent is Messrs Kamadhenu Estate, Kuzhithurai, and the turnover, on which this dealer has been assessed, is Rs. 29,121-1-11, the tax levied being Rs. 455-0-3. The aforesaid turnovers are prices of rubber sold by the dealers at Fort Cochin during 1953-54, which the Deputy Commercial Tax Officer discovered in the first petition, from the accounts of M/s. Peirce Leslie Co. Ltd., and in the other three from the accounts of Messrs Dunlop Rubb .....

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..... icultural properties as well, of being a Central Act, to be beyond the competence of the Legislature and, being therefore, void. Rejecting the argument Gwyer, C.J., observes as follows: "No doubt if the Act does affect agricultural land in the Governors' Provinces, it was beyond the competence of the Legislature to enact it; and whether or not it does so must depend upon the meaning which is to be given to the word 'property' in the Act. If that word necessarily and inevitably comprises all forms of property, including agricultural land, then clearly the Act went beyond the powers of the Legislature; but when a Legislature with limited and restricted powers makes use of a word of such wide and general import, the presumption must surely be that it is using it with reference to that kind of property with respect to which it is competent to legislate, and to no other. The question is thus one of construction, and unless the Act is to be regarded as wholly meaningless and ineffective, the court is bound to construe the word 'property' as referring only to those forms of property with respect to which the Legislature which enacted the Act was competent to legislate; that is to say, p .....

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..... uld not be produces of land that had been intended to be excluded. Indeed the same owner would get the benefit under the provision if the produce be from plantations within the Madras State, but would be liable should his goods from estates in the adjoining TravancoreCochin State come to be sold at Fort Cochin. When confronted with such a position and the presumption of the constitutionality precluding the Legislature having such an intention, the petitioners' Advocate was compelled to argue that the restriction under Article 304(a) is against levying tax at the point of import, and not when the imported goods are being sold in the market. We are afraid that such an interpretation is not justified; and, there are overwhelming decisions declining to place such a restricted interpretation on Article 304(a). The petitioners in Mohd. Siddiq v. M.B. StateA.I.R. 1956 M.B. 214 at p. 218. were carrying on the business of sale and purchase of pugrees, which were mainly manufactured in Uttar Pradesh and Rajasthan; and the complaint was that the State of Madhya Bharat, having exempted similar goods under a notification, pugrees manufactured by similar process in other States cannot be subject .....

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..... ition of sales tax on the petitioner in respect of sales of tobacco imported into Madhya Pradesh was held illegal, being in violation of Article 304(a) of the Constitution, and that the petitioner was entitled to refund of the amount paid by him as tax. The learned Chief Justice observes as follows: "We are not prepared to adopt the construction suggested by the learned Advocate-General, namely, that Article 304 does not deal with the imposition of taxes on purchase or sale of goods and that it refers to tax on imported goods in the act of import. Such a construction is not warranted at all by the language of Article 304(a). That article, as it is worded, gives to the State Legislature the power to impose on goods imported from other States any tax to which similar goods manufactured or produced in that State are subject, so, however, as not to discriminate between goods so imported and similar goods of local origin. Its object is to maintain freedom of inter-State trade and to ensure that no special tax on the act of import or on the imported goods as such is levied. The discrimination spoken of in that article is not discrimination as between the import of goods from outside th .....

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..... , manufacture and sale of coffee, rubber, cinchona, or cardamom, as the case may be, as may be defined to be agricultural income for the purposes of the enactments relating to Indian income-tax." It is clear that what is treated by the same Legislature as a source of agricultural income cannot be treated for purposes of another Act not to be agricultural produce. That apart, one of us in Deputy Commissioner of A.I.T. S.T. v. Raman[1960] 11 S.T.C. 263; I.L.R. 1960 Ker. 624.had held that whether a particular process alters the character of the agricultural or horticultural produce to that of manufactured article, is a question of fact, but as a general guiding principle of law it can be safely laid down that if an agriculturist puts the produce gathered from his lands to certain minimum processes ordinarily employed by an agriculturist to make it really marketable or more marketable or to make it fit to be taken to market, it cannot be said the produce ceases to be an agricultural or horticultural produce. Applying the aforesaid test to the cases before us it is clear that latex is hardened by the application of sulphuric acid, shaped in the form of sheets and dried with the help .....

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